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10 West Hawaii Real Estate | November 9, 2018
Single females remain a force in market, while first-time buyers continue to struggle
Single female buyers continue to
be a powerful force in the market,
while low inventory, rising interest
rates and increasing home prices
remain, holding back first-time buyers
despite notable interest in buying a home.
This is according to the National
Association of Realtors’ 2018 Profile of
Home Buyers and Sellers, which also
identifies numerous current consumer
and housing trends, including mounting
student debt balances; the impact of pets
on home buying decisions; increases in
down payments for all buyers; the rising
age of repeat buyers; and the fact that a
vast number of respondents use a real
estate agent to buy or sell a home, which
kept for-sale-by-owner transactions at an
all-time low.
“With the lower end of the housing
market – smaller, moderately priced
homes – seeing the worst of the inventory
shortage, first-time home buyers who
want to enter the market are having
difficulty finding a home they can afford,”
said NAR Chief Economist Lawrence
Yun. “Homes were selling in a median
of three weeks and multiple offers
were a common occurrence, further
pushing up home prices. These factors
contributed to the low number of firsttime
buyers and the struggles of would-be
buyers dreaming of joining the ranks of
homeownership.”
Here are some additional key trends
of buyers and sellers detailed in this year’s
150-page report.
Single female buyers continue to
be a strong force in the market
For the second year in a row, single
female buyers accounted for 18 percent
of all buyers. The group was the second
most common household buyer type
behind married couples (63 percent).
Single male buyers came in third and
accounted for half the number of buyers
as their female counterparts (9 percent).
However, single males tended to purchase
more expensive homes, with a median
price of $215,000, compared to single
females with a median price of $189,000
(the lowest of all household buyer types).
Share of first-time buyers
continues to fall
The share of first-time homebuyers
continued a three-year decline, falling
33 percent (34 percent last year). This
number has not been 40 percent or higher
since the first-time homebuyers credit
ended in 2010.
“Low inventory, rising interest rates
and student loan debt are all factors
contributing to the suppression of firsttime
home buyers,” said Yun. “However,
existing home sales data shows inventory
has been rising slowly on a year-overyear
basis in recent months, which may
encourage more would-be buyers who
were previously convinced they could not
find a home to enter the market.”
Buyers continue to rely on agents
and the internet to find the right home
For the third year in a row, 95
percent of buyers used the internet at
some point during their home search
process, and 50 percent said that
they found the home they eventually
purchased online. Eighty-six percent of
buyers used a real estate agent in their
home search, and repeat buyers were
more likely to use an agent than firsttimers
(87 percent to 86). Overall, 87
percent of buyers ended up purchasing
their home through a real estate agent
(the same as 2017), as finding the right
home and negotiating terms of sale were
the top factors buyers desired from their
agent. Ninety percent of respondents said
they would definitely or probably use
their agent again or recommend them to
someone else.
“With inventory so low, buyers
are relying on their agent’s knowledge
of markets and neighborhoods to find
listings, rather than relying only on online
searches,” said NAR President Elizabeth
Mendenhall, a sixth-generation Realtor®
from Columbia, Missouri and CEO of RE/
MAX Boone Realty. “A Realtor® has years
of experience, generating insight and
expertise that can help buyers navigate a
tight market where buyers are forced to
move fast and make competitive bids in
order to get their dream home.”
Student loan debt continues to be
an issue
Once again, student loan debt stands
out as a challenge keeping would-be
buyers out of the market. Among the 13
percent of buyers who said saving for
a down payment was the most difficult
part of the buying process, 50 percent
reported that student loan debt had
inhibited their ability to save for a home
purchase or down payment. Twentyfour
percent of all buyers indicated that
they have student loan debt, at a median
of $28,000, and 40 percent of first-time
buyers indicated that they have student
loan debt at a median of $30,000.
“Even with a thriving economy and
an abundance of job opportunities in
many markets, monthly student loan
payments coupled with sky-high rents and
rising home prices make it exceedingly
difficult for potential buyers to put aside
savings for a down payment,” said Yun.